Renesas jumped 4.3 percent to 363 yen, the highest since
May 9, as of 9:09 a.m. on the Tokyo Stock Exchange.

The job cuts, which will affect 12 percent of its
workforce, will be achieved through offering incentives and
early retirements and may save the company 43 billion yen ($539
million) annually, Renesas said in a statement yesterday. The
Kawasaki, Japan-based chipmaker may also close or sell as many
as 10 of its 18 domestic plants in three years.

“The management’s responsibility is to pick a way for
survival, even if that involves pain or sacrifice,” Renesas
President Yasushi Akao told reporters in Tokyo yesterday. “We
needed to take more drastic measures on our cost structure as
our top line is more unstable than before, in addition to the
opportunity losses from the earthquake last year.”

The manufacturer, 91 percent owned by NEC Corp. (6701), Hitachi
Ltd. (6501) and Mitsubishi Electric (6503) Corp. combined, posted a net loss
of 62.6 billion yen in the year ended March 31. Falling demand
for TVs and a drop in prices for chips used in computers have
eroded profit at Renesas’s unit making System LSI chips, used
for functions ranging from processing images for TV screens to
crunching data.